Is Zions Bancorporation (NASDAQ:ZION) Going to Burn These Hedge Funds?

Zions Bancorporation (NASDAQ:ZION) has experienced a decrease in activity from the world’s largest hedge funds in recent months.

In the eyes of most investors, hedge funds are assumed to be unimportant, outdated investment tools of years past. While there are more than 8000 funds in operation at present, we at Insider Monkey look at the top tier of this club, around 450 funds. It is estimated that this group has its hands on most of the hedge fund industry’s total asset base, and by keeping an eye on their best picks, we have discovered a few investment strategies that have historically outstripped the market. Our small-cap hedge fund strategy beat the S&P 500 index by 18 percentage points annually for a decade in our back tests, and since we’ve started sharing our picks with our subscribers at the end of August 2012, we have beaten the S&P 500 index by 25 percentage points in 6.5 month (explore the details and some picks here).

Zions Bancorporation (NASDAQ:ZION)

Equally as key, positive insider trading sentiment is a second way to break down the marketplace. Just as you’d expect, there are many motivations for a corporate insider to get rid of shares of his or her company, but only one, very simple reason why they would initiate a purchase. Several empirical studies have demonstrated the useful potential of this method if piggybackers know what to do (learn more here).

Consequently, we’re going to take a peek at the key action surrounding Zions Bancorporation (NASDAQ:ZION).

How have hedgies been trading Zions Bancorporation (NASDAQ:ZION)?

In preparation for this year, a total of 21 of the hedge funds we track were bullish in this stock, a change of 0% from one quarter earlier. With the smart money’s positions undergoing their usual ebb and flow, there exists an “upper tier” of noteworthy hedge fund managers who were boosting their stakes considerably.

Of the funds we track, Daniel S. Och’s OZ Management had the most valuable call position in Zions Bancorporation (NASDAQ:ZION), worth close to $11 million, comprising 0% of its total 13F portfolio. Coming in second is Nick Niell of Arrowgrass Capital Partners, with a $8 million position; the fund has 0.3% of its 13F portfolio invested in the stock. Some other hedge funds with similar optimism include Matthew Lindenbaum’s Basswood Capital, Phill Gross and Robert Atchinson’s Adage Capital Management and Cliff Asness’s AQR Capital Management.

Seeing as Zions Bancorporation (NASDAQ:ZION) has faced falling interest from the entirety of the hedge funds we track, we can see that there exists a select few money managers that elected to cut their full holdings last quarter. Intriguingly, Israel Englander’s Millennium Management dropped the biggest position of all the hedgies we watch, comprising about $14 million in stock., and Nick Niell of Arrowgrass Capital Partners was right behind this move, as the fund dumped about $8 million worth. These bearish behaviors are intriguing to say the least, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).

Insider trading activity in Zions Bancorporation (NASDAQ:ZION)

Insider trading activity, especially when it’s bullish, is best served when the company in question has experienced transactions within the past half-year. Over the last 180-day time frame, Zions Bancorporation (NASDAQ:ZION) has experienced 3 unique insiders purchasing, and 6 insider sales (see the details of insider trades here).

With the results demonstrated by Insider Monkey’s tactics, everyday investors should always monitor hedge fund and insider trading activity, and Zions Bancorporation (NASDAQ:ZION) is an important part of this process.

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